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At least three major financial institutions reportedly obtained early access to crucial data from the Bureau of Labor Statistics (BLS), drawing scrutiny to the agency for what appears to be the second time it mishandled info this year.
What Happened: As reported by Bloomberg, Mizuno Financial Group Inc., Nomura Holdings Inc., and BNP Paribas were able to secure annual nonfarm payroll revisions via phone calls with the government department before the official release.
The BLS was scheduled to publish the much-anticipated revisions, which showed a downward adjustment of 818,000 nonfarm payrolls from April 2023 to March 2024, at 10 a.m. ET on Wednesday.
However, the data did not go live on the agency's website until 10:34 a.m. ET, leaving the market in a state of uncertainty.
Regarding the delayed publication of the nonfarm payroll revisions on Wednesday, the BLS responded in a post on social media platform X: “We are aware there was a delay to the CES preliminary benchmark announcement. We are looking into the reason for the delay. We have no additional information to share regarding the delay at this time.”
See Also: US Inflation Data Prematurely Released By Accident, Yet Traders Missed Golden Opportunity
Why It Matters: During this 34-minute delay, the three banks had a significant advantage, potentially allowing them to exploit privileged economic information for over half an hour.
In May, the Bureau of Labor Statistics accidentally released April’s consumer price index (CPI) figures 30 minutes ahead of the scheduled 8:30 a.m. ET release.
"In advance of today’s CPI and Real Earnings releases, BLS inadvertently loaded a subset of files to the website approximately 30 minutes prior to the release," the Bureau stated.
Despite this, the market failed to react, as traders were caught off guard and did not expect the early availability of the highly awaited inflation report on the BLS website.
This series of incidents raises serious concerns about the integrity of market-sensitive data releases and the potential for unfair trading advantages.
Market Reactions: Once the data finally became public, the S&P 500 — as tracked by the SPDR S&P 500 ETF Trust (NYSE:SPY) — reached its session highs at 10:44 a.m. ET, driven by increased trader optimism about Federal Reserve rate cuts.
It closed Wednesday at $560.62, up 0.34%.
Conversely, the U.S. dollar index began its decline for the session, a movement further supported by the release of the Federal Open Market Committee (FOMC) minutes from the July meeting, which bolstered the case for a September rate cut.
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Posted In: SPY
